Check the
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[ ]

Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)

On September 10, 2010, American Power
Corp. (the “Company”) entered into a Stock Issuance Agreement (the “Agreement”)
with Black Sands Holdings Inc., a corporation organized under the laws of the
Marshall Islands (“Black Sands”), whereby the Company has the right to require
Black Sands to purchase up to $10,000,000 of the Company’s securities until
March 31, 2013, unless extended by either the Company o Black Sands for an
additional twelve (12) months.

Under the terms of the Agreement, the
Company may, from time to time, request an advance from Black Sands up to
$1,000,000, in integral multiples of $100,000 (each, an “Advance”) per request
for operating expenses, acquisitions, working capital and general corporate
activities. Following receipt of any Advance, the Company shall sell
and issue Black Sands units, each unit consisting of one share of the Company’s
common stock and a warrant to purchase one share of common stock at the Unit
Price. As described in the Agreement, the “Unit Price” shall mean a price equal
to 75% of the volume weighted average of the closing price of the Company’s
common stock for the ten (10) business days preceding the date of any notice
requesting an Advance, as quoted on Nasdaq or such other quotation system as
agreed upon by the Company and Black Sands. Each warrant issued as
components to Units shall represent the right of Black Sands to purchase one
share of common stock at an exercise price equal to 150% of the Unit
Price. All warrants to be issued as components to the Units will have
a three (3) year term from the date of issuance.

The foregoing is qualified in its
entirety by the Agreement. For further information see the Agreement
attached hereto as Exhibit 10.1 and incorporated herein by
reference.

On September 10, 2010 the Company
entered into a Settlement Agreement (the “Settlement”) with Black
Sands. In exchange for the release of claims by Black Sands against
the Company, we have agreed to enter into a debt to equity conversion as a means
of settling the outstanding loan amount of
US$208,602.74. Accordingly, Black Sands has agreed to settle the
outstanding amount owed by the Company through acceptance of common stock (the
“Shares”) of the Company. Such Shares will be issued at a conversion rate of
$0.50. The parties agree that 417,205 shares will satisfy the amount of
US$208,602.74 in full. The Shares will be issued with a restrictive
legend.

The
foregoing is qualified in its entirety by the Settlement. For further
information see the Settlement attached hereto as Exhibit 10.12 and incorporated
herein by reference.

Section 3 — Securities and Trading
Markets

Item
3.02 Unregistered Sales of Equity Securities.

The disclosure under Item 1.01 is
incorporated by reference in its entirety into this Item 3.02.

Although the Company has not requested
any Advance at this time, the Company has the right to request an Advance(s)
from Black Sands to purchase during the term of the Agreement up to $10,000,000
worth of Units. In the event the Company requests an Advance from Black Sands,
the number of Units to be sold and issued to Black Sands, and the Unit Price
therefor, shall be conducted pursuant to the terms and conditions of a
subscription agreement, which will be further disclosed by the Company in a
subsequent Form 8-K under this Item 3.02. As contemplated, any sale
and issuance of Units to Black Sands will be conducted in reliance upon an
exemption from registration under the Securities Act of 1933, as amended,
afforded by Regulation S promulgated thereunder.

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